The bid and ask prices of a call with strike price of 100, Ask an Expert

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The bid and ask prices of a call with strike price of 100 are 10.15 and 10.4, respectively. The bid and ask prices of a put with strike price of 200 are 10 and 10.3 respectively. An investor believes that the price of the underlying stock will be extremely volatile in the coming four months. She also estimates that the probability of going up. Thus, she decides to construct a strategy with longing one contract of the call and two contracts of the put. The breakeven points of this strategy are _______ and _____.

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Financial Management, Finance

Category:- Financial Management
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